New Silk Road Strengthens China’s Position in Southeast Asia

In the process of strengthening its influence, China is developing cooperation with its neighbors, seeking to bind all the small states in the surrounding region to itself economically. Chief among these smaller states are the ASEAN member countries. To achieve economic integration with these countries and ensure its continued presence in them, China is setting up plans employing the well-proven and effective method of constructing railway networks within their territories. Within the framework of the Belt and Road Initiative, China aims to cover the region of South-East Asia (SEA) with a dense railway network and connect it to its own transport system.

A state occupying a special place among the regional partners of China is the Kingdom of Thailand. Of all the states of China’s strategically important Indochina Peninsula, Thailand is the most developed. Thailand is also an influential member of ASEAN. At the same time, the geographical position of Thailand can allow China to implement effective solutions to a number of its most important tasks related to energy security and the implementation of the Belt and Road Initiative project. It is public knowledge that this ambitious Chinese project was originally designed for covering the whole world with a network of trade routes. Within the provisions of the project, China is building railway networks throughout Eurasia and Africa, not forgetting South America. The ‘Sea Silk Road’ subproject is primarily based on the successful development of navigation along the southern coast of Eurasia and around the globe.

Most of the sea shipping in the world is carried out through several channels that act as gateways connecting the main parts of the world’s oceans and seas. Some of these include the Suez Canal, the Strait of Malacca, and the Panama Canal. The alternative way of going around these “gateways to the sea” is too long and expensive. However, China is not in direct control of these channels. To ensure uninterrupted navigation under any circumstances, China is planning to construct new channels that will run parallel and near to the traditional ones, but will be controlled by China or its allies. Under this project, China is setting up plans to build a channel in Nicaragua that will become an alternative to the Panama Canal. An alternative to the Strait of Malacca could be a channel running through the Thai Kra Isthmus, although the dragging of the process of adopting a final decision by the Thai government means that its construction is still in question. However, in case of the continuation and further development of the Sino-Thai relations, the channel might be rendered obsolete, and could be replaced by railways.

It is well known that the main inconvenience for China associated with the Strait of Malacca is that through this narrow stretch of sea sandwiched between Indonesia, Malaysia and Singapore, oil and liquefied natural gas (LNG) from the Middle East are delivered to China by tankers. Thus, the closure of the canal (for example, in the event of further tension in the South China Sea) will threaten China’s energy security. However, Middle Eastern oil and LNG can also be delivered to China by land. Ships coming from Arab countries can be unloaded at the ports of Myanmar, another major state of the Indochina Peninsula, which borders China and with which China actively cooperates in various fields. A pipeline has already been constructed to deliver energy through Myanmar to China. If, for some reason, transit through Myanmar is impossible, arrangements could also be made to deliver hydrocarbons through Thailand and Laos. Although this route is more complicated than through Myanmar, it is still quite feasible.

China views the creation of its own energy security and the unimpeded implementation of shipping as its most important goal for which it needs to increase its influence on the Indochina Peninsula, especially in Myanmar and Thailand. To permanently gain a foothold in Indochina and become the main partner of all countries in the region, China has decided to create a network of railways in the region, and connect it with the Chinese railway system. The same railways would also deliver cargo coming in from the sea.

In December 2014, a Sino-Thai memorandum was signed, under which China and Thailand pledged to cooperate in implementing the 2015-2022 plan for the development of Thai infrastructure. In December 2015, the media reported the construction of a high-speed railroad ‘China-Thailand’ more than 800 km long, stretching from the Thai capital Bangkok to the city of Nong Khai on the border with Laos, where it will connect with the ‘China-Laos’ road. The project was to be implemented based on Chinese standards and technologies. China also took part in financing the project. In March 2017, Thai leadership announced a ten-year plan for a major upgrade of the entire Thai rail infrastructure. Under this plan, the Thai railways are expected to be extended to become 2.5 times longer, reaching 10 thousand kilometers. The main task of modernization is to strengthen networking with other Southeast Asian countries, increase freight traffic within the country and begin transiting freight traffic through the territory of Thailand. China’s participation in this project is not reported, but it fully corresponds to the Chinese plans to create a unified transport system.

The creation of a railway network in Southeast Asia and the accession to the Belt and Road Initiative project are measures that will soon begin bearing fruit for the ASEAN countries. Given this, the transportation of goods from Southeast Asia to Europe through China and Kazakhstan will soon begin in earnest. In March 2017, representatives of Vietnamese state corporation Vietnam Railway attended a meeting of the ‘Organization for Cooperation of Railways’ in the capital of Kazakhstan, Almaty. During the visit, the Vietnamese delegation visited the Kazakhstani free economic zone ‘Khorgos’ on the Sino-Kazakh border. The Sino-Kazakhstan railway passes through this important logistics center. Already in 2017, transit trains from Vietnam shall begin passing through it, giving rise to a new form of transportation between Southeast Asia, Central Asia and Europe.

Over the years of existence of the Belt and Road Initiative project and its subprojects ‘New Silk Road’ and the ‘21st Century Silk Road’, the appearance of such long transport routes has already ceased to amaze. It seems that China is closer to its goal of creating a worldwide transport system. The task of strengthening positions in Southeast Asia will also be accomplished successfully. It should be noted that the railway connecting Southeast Asia with China and other countries will undoubtedly play an important role in the economic development of this region.

Electronic analytical journal New Eastern Outlook 2010-2017Republishing of the articles is welcomed with reference to NEO.The views of the authors do not necessarily coincide with the opinion of the editorial board.